With 31 million daily playing and paying users in 180 countries, you’d think gaming platform Roblox would be more of a household name, that is, outside of its core 5- to 13-year-old demographic and the 1 million IT developers who populate its digital stable of products.
While the California-based company has been around since 2004 and did nearly $600 million in revenue in through the third quarter last year, Roblox’s new life as a publicly traded company on the New York Stock Exchange — where it debuted Wednesday (March 10) with a valuation larger than better-known brands like Etsy, Kroger or Best Buy — could be a game changer.
“Roblox’s mission is to build a human co-experience platform that enables shared experiences among billions of users [who] have fun with friends as they explore millions of immersive digital experiences,” a recent company press release said.
My Avatar, My World
Because more than half its users are under 12, safety, civility and positivity are critical for Roblox. To play, each user creates their own unique avatar and identity and then goes out to meet and interact with existing friends or new ones in a 3D virtual world.
“The success of our business model is contingent upon our ability to provide a safe online environment for children to experience and if we are not able to continue to provide a safe environment, our business will suffer dramatically,” company risk disclosures said.
The platform is accessible via iOS, Android, PC, Mac and Xbox devices and basic service and games are free, while many advanced activities require a payment in the platform’s proprietary currency, Robux.
“Users who choose to purchase Robux can spend the currency on experiences and on items for their avatar,” the company’s prospectus said. At the same time, “developers and creators earn Robux by building engaging experiences and compelling items that users want to purchase,” the federal filing said, which they can then “convert back into real-world currency.”
Roblox said it works with multiple payment and gift card processors including “Amazon, Apple, BlackHawk, ePay, Google, Incomm, PayPal, Vantiv, and Xsolla.”
Capitalized And Competitive
Of the 960,000 developers and creators on the Roblox Platform, over 1,000 earned more than $10,000 last year, while 250 earned over $100,000.
In total, Roblox users spent 22 billion hours on the platform and explored an average of over 20 different experiences each month.
Roblox said it competes against some of the biggest names in tech, media and gaming in a global fight to “attract and retain users’ attention.” It also competes to attract the tech-whizzes who create the games and experiences.
If the name Roblox is new to you, its stated list of competitors is not. It includes Amazon, Apple, Facebook, Google, Microsoft and Tencent in the tech space; Comcast, Disney and ViacomCBS in media; Activision Blizzard, Electronic Arts, Take-Two, Valve, Unity and Zynga for gaming; and again Netflix, Spotify and YouTube streaming content.
To make it all work, Roblox works with multiple payment and gift card processors including Amazon, Apple, BlackHawk, ePay, Google, Incomm, PayPal, Vantiv and Xsolla.
According to CNBC, Roblox has become “one of the top-grossing apps for Apple and Google devices, by turning youthful users into game creators without forcing them to learn complicated coding.”
P.J. McNealy, the CEO of Digital World Research, said Roblox was “a bit of a substitute babysitter when some parents need a break at home,” describing it as Minecraft meets Nintendo meets Lego on a mobile phone.
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